The State Bank of Pakistan Saturday announced reduction in overnight reverse repo (ceiling) rate from 8.50 percent to 8.00 percent p.a. The SBP overnight repo facility will be available at 5.50 percent p.a. This will serve as the 'floor' for the interest rate corridor. Hence, the floor and ceiling levels for the interest rate corridor are 5.50 percent and 8.00 percent p.a. respectively (ie width of 250bps). According to SBP new rates will be effective from 24th March, 2015.
Moreover, in case an eligible institution accesses either of the above facilities more than 7 times during a given quarter, a spread of plus/minus 50bps will be applied over & above the applicable SBP overnight reverse repo & repo rates, respectively for the remainder of the same quarter.
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